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Interest Rates, Inflation, and Investments in Turkey

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Does anybody know about the interest of the vadeli hesap in Ziraat Bankasi? Two years ago it gave me 8 percent as far as I remembered for 10000 tl. It means that, every month it pays extra money for my main account. 65 tl for months with 30 days. It is not a yearly vadeli and the advantage is that you could withdraw any time you want without fare (ceza)

Please give me information.

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Thank you. Look at my plan for financial success as a "Get Rich Slow" plan. I have zero  problem in helping you or others become financially independent.  What I learned about financial mana

Yes of course you can go to any of the tax offices in Turkey.  I find it hard to believe that they gave you a bank account without a tax number at Ziraat Bankasi though?!  Never ever heard of that bef

I assume you're talking about changing all of your money over to Lira. If you have a bank card you can pull money out of the bank machine when you need it, which is what I have done for years. Ziraat

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The best information I can give you is don't just look at the interest rate. You must also look at the inflation rate.

This is a mistake often made by expats in Turkey. They say "hey, I only earned three percent interest on my savings account in my country, but I'm earning ten percent in Turkey!"

They are deluded, because they aren't also looking at the inflation rate, which is probably lower in their country as compared to Turkey.

Inflation rates play a large part in determining interest rates.

So in 2015 you were getting eight percent interest. But, according to Statistica.com, the inflation rate in Turkey, during that same year, was 7.67 percent. To calculate the real rate of return, add "1" to both the interest rate you are getting and the inflation rate. Then subtract the inflation rate from the interest rate.

So your real rate of return during that year was

1.08 (interest rate) - 1.0767 (inflation rate) = .013, or 1.3 percent real return.

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Definitely right.

Since, I did not use that money and my source was from the university, I thought that it is better that I gave it to the bank and at least they gave me the monthly internet bill:)

I will have my money in dollar maybe it is better to keep it in bank as dollar!

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Since I am an American, I have a bank account in the USA. I am retired, and get paid in US dollars. This has been very good for me lately in Turkey. Until now, every now and then, I have just been going to the bank machine, or ATM, to take out money to pay my rent and bills, in cash. But it can be a pain in the neck, since I have to go in person to my landlord's bank to pay the rent, and have to go to a bill payment center to pay for my utilities, television, etc. every month.

So I went to my landlord's bank and opened an account. That way I can just transfer the rent money from my account to my landlord's account using the internet. And I can also set up automatic payments for my utilities and other bills. All I have to do is transfer money into my Turkish account from my US account, at the beginning of every month.

So maybe a Turkish bank account might not be the best way to earn interest (savings accounts are never the best way), they can definitely be useful.

If you want to earn interest, or dividends, on your money in Turkey, I have a Turkish friend who is a fee-only financial planner. Fee-only financial planners are the best, because they work for the person who pays their fee. If a financial planner doesn't charge a fee, they will probably just sell you whatever financial instruments they earn the best commissions from, rather than those which are best for you. If you have need of a financial planner in Turkey I will send you his information by personal message (PM).

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Thanks for your patience in answering the questions.

Is it just for big amount of money? I mean, does it work for a few amounts of money?!:rolleyes:

I exactly don't understand what exactly their responsibilities are? Also, could we trust them?! You know, it is really important especially for the person who does not have citizenship and his hand is far from the laws!

Do you invest in the same thing too? Please explain more.

I have a few economical and financial info. about stock exchange, bourse, money exchange, and etc.

Please give me his/her info. if you trust him:)

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Is it just for big amount of money? I mean, does it work for a few amounts of money?

I would assume that it would involve a fairly large amount of money, or regular investments over time. But only for those who want to invest in Turkey. It may be that your country has better investment options. This would not be a bank account, it would be money invested in Turkish companies, involving stocks and bonds.

This would also involve something called a "mutual fund." A mutual fund is a pool of money, contributed by investors like yourself, and managed by someone working for a mutual fund company. The mutual fund would have certain objectives, such as high-risk speculative stocks and bonds, or medium risk, more stable stocks and bonds (from which you would get a lower, but still respectable, return), or very stable investments which would yield the lowest returns, but be much more reliable and steady.

Let's say you buy into a mutual fund of stocks. While there are mutual funds which invest in certain business sectors, others invest in a diversified group of companies. Diversification is good because if the economy changes and some companies are hit badly, others will do well because of the changes, and a diversified mutual fund will own stocks in both types of companies.

A financial planner would recommend to you which type of mutual fund to invest in, one which is best for you.


I exactly don't understand what exactly their responsibilities are?

There responsibility would be to advise you on the best investments for you, based on your situation. For example, if you are young and are investing for retirement some forty years later, you can take more risk. Risk being defined in fluctuations in value. Over the long run, stocks perform better than other investments, but they fluctuate in value along the way. Then as you get closer to your long term goal, a financial planner might recommend you start moving your money into bonds, which still fluctuate in value, but less, and also yield lower returns. Then when you come close to retirement, a financial planner should recommend you start moving money into more short-term, but reliable investments, which fluctuate very little.


Also, could we trust them?

The financial planner wouldn't be managing your money. He would only be advising you on the best funds to invest in. And when you invest in a fund, the fund management company will send you literature explaining what their strategy is and what they are investing in (and why). So you would be dealing directly with your investments. The financial planner would only be recommending where you invest.

So for example, let's say your financial planner tells you that you should invest in XYZ fund. You ask for literature about XYZ, and get literature from them. Then you read it, and you decide if you want to invest or not.


You know, it is really important especially for the person who does not have citizenship and his hand is far from the laws!

Absolutely. And you should never put all of your eggs in one basket! And you definitely should do some research on the company which will be managing  your investment before you invest.


Do you invest in the same thing too?

No. But my situation is completely different from yours.

I used to invest in mutual funds in the USA. I wasn't disappointed, I just got interested in real estate and bought properties instead.

I figured out that the US military was paying me money for my housing, and it didn't matter if I rented a place or bought one. So I started buying. When I got transferred overseas I would use a property management company to rent out the property I bought, then collect rent.

When I returned to the states, the rent income would cover the mortgage debt on the property I had bought previously, so I could qualify for another loan and buy another property.

Besides that, I volunteered for deployments to places where I would get imminent danger pay and hostile fire pay. That can really add up, since one in such a situation has few expenses.

I survived, and used the money I earned to pay off the mortgages on the properties I bought.

In my situation, at the time, it was the best way to set up a nice supplement for my retirement. And for me, that was the best thing, financially, I could have done. I definitely wouldn't recommend doing that to anyone else.

Right now I am retired, so it makes no sense for me to invest in stocks, bonds, or mutual funds offering those things. I don't need to invest in anything any more.


I have a few economical and financial info. about stock exchange, bourse, money exchange, and etc.

Don't get involved in currency exchange. It is like gambling. Maybe you will win a lot but you can also lose a lot. It is extremely volatile.

Don't invest in one company. Invest in a mutual fund which invests in many companies. That way, if one company does badly, it won't bring the value of your investment down so much, because the fund you are invested in will be invested in a diversified portfolio of companies.

Read up on the internet about mutual funds and how they work.


Please give me his/her info. if you trust him

I cannot recommend anyone. The person I mentioned, we have worked as partners in the past, and I have known him for many years. He has never been dishonest with me, I have never known him to be dishonest with anyone else, and he has never said or done anything which would make me think he is dishonest. If I wanted to invest in Turkey, I would go to him. I haven't seen him for a long time, but we keep in touch. Recently he has told me that he is now a fee-only financial planner.

In any case, whoever you deal with, be sure to do your own research as well. If you don't understand something, then learn it, on your own. There are lots of resources to learn about various types of investments on the internet. A fee-only financial planner is there to point you in the right direction and make recommendations. You make the final decision, and your decision should be an educated one. That way you can stay in control of your own investments.

I will send you a PM with his contact information.

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The best investment you can make is an investment of your time to learn about personal finance and investing. Then you can do so intelligently and not rely on guesses and other people's advice. There are many books about this which can help you, just look on Amazon.com.

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  • 2 weeks later...

Did my MBA. I was studying to be a personal financial planner before I came to Turkey. But I learned how to manage my personal finances from books. I am doing very well in Turkey, because of what was taught to me, and what I taught myself.

If anybody wants any recommendations about how to accumulate wealth, even in Turkey, let me know by PM.


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Personally I have never invested in Turkey, except for making the mistake of buying a business. As soon as he had the money, the previous owner got on a plane for the USA. And left me with a lot of problems he never told me about. The business didn't last long, and I lost everything. It was a big mistake, trusting the previous owner, and putting all of that money into one small business. If I had put that same money into a mutual fund, I would have made money instead of losing it.

My investments were in mutual funds and property in the USA.  It is mutual funds I would recommend. There are mutual funds which invest in growth and income stocks (they go for growth in the value of the companies as well as dividends paid), also strictly growth or strictly income. There are mutual funds which invest in a variety of developing countries. Or tech stocks. Or aviation stocks. Or real estate. Or companies which specialize in gold or precious metals. Just about anything you want to invest in, there is probably a mutual fund which invests in it.

Mutual funds are investment plans overseen by a manager. The manager invests in stocks, bonds, or short-term debt instruments according to the "prospectus," or plan for that fund. So you could invest a thousand dollars, and that will be diversified into whatever stocks, bonds, or debt instruments determined by the prospectus. You can get a prospectus for any mutual fund sent to you for free, or read it online, so you can evaluate it before you invest in the fund.

You can also invest in bonds.  While stocks are actual ownership of companies, divided into "shares," bonds are debt instruments. You buy a bond and after the bond matures, which can be anywhere from one to 30 years, the company pays back the money with the interest as guaranteed by the bond. Bond funds invest in these types of instruments.

You can also invest into mutual funds which are a mix of growth stocks, income stocks, and bonds.

So rather than put all of your eggs in one basket, invest in a mutual fund. The company I used is a very reputable company, T. Rowe Price. I would recommend them.

T.  Rowe Price offers "no load" mutual funds. That means you don't have to pay a fee to get into them. You just have to invest a minimal amount, or set up a monthly plan to invest a regular amount into their mutual funds.

One thing you should familiarize yourself with is volatility. For example, a tech stock will fluctuate a lot, which means it has high volatility. But it can also have a very high payoff. Your savings account, at the other extreme, will have zero volatility. And pay a low, but practically guaranteed, return.

A stock like Coca Cola also has a lot less volatility, and it pays dividends (it pays out profits to the share holders from time to time). Coca cola would fluctuate less than the stock of smaller companies or tech companies, but it will still fluctuate.

If you have a lot of time, you can wait out such fluctuations. While a stock might fluctuate a lot, it will still gain value over time.

Think of it like a man walking a dog. While the dog goes left and right, the man still goes in the same direction. Most mutual funds are like that. They grow over time, but they have fluctuations along the way. As the man might have his dog on a short leash or a long one, so will various stocks fluctuate over time.

When you get to around five years of needing the money, start moving it out of stock mutual funds and into bond mutual funds, which are less volatile. Then when you get to around two years start moving it into the least volatile. Cash funds, or mutual funds which invest in very short-term debt instruments. These are debt instruments with a duration of one day to a few months maybe. For that reason they fluctuate very little, but also have a lower yield.

Know This:

The best investment you can make is to buy a book on personal investing. And read it. In that way you can learn about how it all works, and educate yourself before you invest in anything.

What you will learn is nothing new. The principles taught in such books are the same as they have been for hundreds of years. So why isn't everybody rich? Because for whatever reason, few people follow the guidelines of such books. So basically I have just given you the key to your financial success. Whether you use that key or not is up to you.

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Thank you. :)

Look at my plan for financial success as a "Get Rich Slow" plan.

I have zero  problem in helping you or others become financially independent.  What I learned about financial management helped me tremendously. All of it was taught to me by another. So I am happy to pass on what I have learned.

I do have a problem with one thing though. Foreigners who are ready to throw their money into a business because they trust the Turkish owner. They throw all of their money into a single, very risky, investment over which they have no control. Then they lose all of their money.

Now, I cannot blame the foreigner. The foreigner has a good heart. And expects his or her Turkish  partner to also have a good heart.

So why does the foreigner do this?

Well obviously because of trust. But mostly because of ignorance. Ignorance of sound principles of personal financial planning. Ignorance of better alternatives than the bar or coffee shop they think they will own.

In my opinion, personal financial planning should be a part of every child's basic education. But it isn't.

Star, If I can steer you in the right direction, if I can prevent you from going through what I did, if I can get you to put your money into more stable and profitable investments which you, and no one else controls, I will be happy.

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2 hours ago, Ken Grubb said:

In my opinion, personal financial planning should be a part of every child's basic education. But it isn't.

So much great. Great! Great! More than agree. 

Thanks my American friend...

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It is not just an issue of your Turkish partner that can cause you to fail, the rules change very quickly too without warning. In our University town there are many good purpose built studio flats to rent to students. Some families have invested heavily to get a return. As you can imagine small communities grow around the student areas coffee bars, bars, restaurants, fast food outlets tea houses etc. this summer the government issued a decree declaring that licenses would not be issued to student apartments located within 100m of coffee houses, bars, or places that sell alcohol. How can you plan for events like this?

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I am getting 12.5% at Yapi Kredi bank in Side now in a TL monthly deposit account.  These are the different accounts on offer at the bank...

Yapı Kredi offers you diversified deposit and investment alternatives for your different financial needs.

  • Current Account: You can deposit your funds in TL or any other foreign currency for your daily cash flow needs. You can use your current acount for daily payments, spendings or transfers.
  • Time Deposits: You can open a time deposit account to take the advantage of a risk-free return at the end of a fixed-period investment horizon. Yapı Kredi offers you advantageous interest rates for any time period that match to your investment needs.
  • e-Deposit : You can easily open a time deposit account through Internet and Telephone Banking and earn higher interest rates.
  • Gold Deposit: You can open a Gold Account with Yapi Kredi and watch your gold accumulate without the risk of theft. If you would like to protect yourself against the sale of underweight, low-carat, overdated and unregistered gold coins or if you want to just avoid paying labor and workmanship, you can open a Gold account.
  • Gold Time Deposit: You can open a gold time deposit account to take the advantage of investing in gold and earning interest at the same time.

Ziraat Bankasi only offer 10.75% interest ... see here and click on Time Deposit Account Interest Rates at the bottom of the page ... https://www.ziraatbank.com.tr/en/Retail/DepositProducts/Pages/TurkishLiraTimeDepositAccounts.aspx ...

HSBC in Turkey is even less ... see gere ... https://turkey.deposits.org/providers/hsbc-turkey.html

Good luck, Star and let us know how you get on, won't you?  x Angela in Side, Turkey x

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Thanks Angela

However, as far as I know the only bank I could open account is ziraat! I mean I have that account opened 2 years ago. Is yapi kredi opens account it would be suitable though.

Just a question. I know that the profit is given monthly but is it a yearly contract or daily?!

For examale in ziraat I did not pay any fair when I closed my vadeli hesab. That time it gave 8 percent interest because of less inflation.

It it same in other banks?

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I don't know for sure but I would think that Internet Banking gives a better interest rate as you do it yourself and manage it yourself, whereas Branch Interest Rates are managed for you by your bank, so you would get a little less that way.  Personally, I would never do Internet Banking... just too risky and too many hackers about nowadays ... better be safe than sorry.  

I have banked with Yapi Kredi for 13 years now and they have been excellent.  13 years ago I was getting 29% interest on my monthly TL deposit account ... now I get 12.5% ... so for the past 13 years I have lived quite happily just on my interest and have not had to go into my capital sum at all.  After I had been with Yapi Kredi for 10 years, there was a knock on my apartment door and a courier from the bank stood there with a big package.  I said he must be mistaken because I had not ordered anything but he insisted it was for me.  Anyway, when I opened it I was delighted to find 8 x tins of different fresh Turkish coffees and teas for me from Yapi Kredi just to thank me for my business over the past 10 years.  What a lovely surprise!   On the other hand, I have banked in the UK with NatWest Bank for over 30 years and have never had a thing from them at all. 

You don't need to live in Turkey to open a bank account there... my brother Tony just came to Side, Turkey for a 2 week holiday 2 years ago and opened an account at Yapi Kredi as well ... he just gave his hotel address.  First you must go to the tax office and get a number which, 2 days later, you take to the bank to open an account.  All you need at the tax office is a photo-copy of the picture page in your passport and take that to them.  The tax office will then give you a small form to fill in which just asks for your parents' names - does not matter whether they are dead or alive - your address ... and that could be the hotel you are staying at ... your name and date and signature and they will issue you the number and give you the piece of paper with it on for you to keep.  Do not lose that paper.  In fact, make a copy of it for future reference as you will be needing it often in Turkey.

x Angela in Side x

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Actually I have an account in ziraat bankasi. I have a rp card which is expired and I will be a student in Turkey. Did I have a tax number you mean? I do not remember anything like that? I just get it for my mother since she had not rp (Tourist). You mean I have one.

I should ask. But if anyone here goes regularly to the yapi kredi please ask them whether they open an account for iranian (especially student) too?


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You must have had a tax number to open your bank account with Ziraat Bankasi ... if you have mislaid it,  just go back to the tax office you think you went to earlier, with a copy of the picture page of your passport and get the tax number... they keep it on file on their computers, so not a problem at all.  Yapi Kredi will be happy to open an account for you and, again, not a problem that you are from Iran or that your Residency Permit has expired ... just an address in Turkey ... home or rental or even the hotel you are staying at ... and your tax number and passport.  x Angela in Side x

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So trust in yapi kredi?

Actually, it is really surprising that I never gave tax number to the ziraat! Just I gave them my rp card and they issued my task. Yeah I should go to the vergi dairesi. Any vergi dairesi, right? No problem if I go to another one since I will be in another city?

Thanks angela for your patience

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